Hearings to examine deregulation and competition, focusing on regulatory burdens to unlocking innovation and spur new entry.

Antitrust, Business Rights and Competition

2025-06-24

Source: Congress.gov

Summary

This hearing focused on unlocking innovation and market entry by addressing anti-competitive government regulations that often entrench incumbent businesses and stifle competition, ultimately harming consumers and economic growth [ 00:26:19-00:26:27 ]

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. While there was broad agreement on the need to foster competition and protect consumers, speakers debated whether deregulation or robust antitrust enforcement should be the primary approach .

Themes

Impact of Regulations and Deregulation

Many regulations, though often intended for public protection, can inadvertently create "monopoly moats" by imposing high compliance costs that only large incumbents can manage, thereby hindering new entrants and innovation [ 00:26:39-00:27:20 ]

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[ 00:46:27-00:46:32 ]

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. The Federal Trade Commission (FTC) and Department of Justice (DOJ) are actively reviewing public comments on regulations that reduce competition, entrepreneurship, and innovation, finding a consistent theme that Americans desire a fair chance to compete [ 00:46:40-00:47:08 ]

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. Some powerful companies may even advocate for regulation to entrench their monopoly power, as they can absorb compliance costs that smaller competitors cannot [ 00:49:24-00:49:53 ]

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. While deregulation can level the playing field, some argue that regulations themselves are not inherently bad if they serve their intended purpose of promoting competition and protecting public safety . Conversely, insufficient antitrust enforcement is also blamed for market concentration, highlighting the need for empowered federal antitrust enforcers with adequate funding and resources .

Healthcare Industry Regulations

The healthcare sector faces significant anti-competitive barriers, including scope of practice laws, price opacity, non-compete clauses, and burdensome licensure requirements that limit choice for patients and providers [ 00:47:22-00:47:35 ]

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. "Certificate of need" laws in many states, which require bureaucratic permission for healthcare providers to enter or expand markets, are criticized for allowing incumbents to block entry and harm patients . Similarly, "certificate of public advantage" laws permit states to grant antitrust immunity for private mergers, leading to hospital monopolies . In the pharmaceutical industry, companies may list numerous patents in the FDA Orange Book to deter generic competition, a practice that the USPTO could help mitigate by reviewing newly listed patents for validity . Overall, the healthcare system is described as a complex mix of private monopolies, problematic public regulation, and market opacity, making it difficult for consumers to shop for care and for new health plans to innovate [ 02:20:53-02:21:22 ]

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.

Agriculture Industry Regulations

The U.S. cattle and sheep industries are facing a crisis due to market concentration and "de facto deregulation" of antitrust laws, leaving producers vulnerable to monopolistic practices [ 01:03:00-01:03:06 ]

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[ 01:03:53-01:03:56 ]

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. Four major packers control 80% of the fed cattle market, enabling them to reduce prices paid to ranchers while increasing consumer beef prices [ 01:04:15-01:04:45 ]

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. The "Beef Checkoff Program," funded by mandatory producer assessments, is criticized for funneling money to lobbying organizations that act against independent producers' interests, such as opposing mandatory country of origin labeling . The elimination of mandatory country of origin labeling in 2015 allows foreign beef to be repackaged as domestic, deceiving consumers and harming American ranchers . Additionally, the "right to repair" is a growing concern for farmers who face limitations from manufacturers like John Deere in repairing their own equipment due to technological controls and intellectual property claims .

Role of Private Enforcement and Arbitration

The importance of private enforcement in antitrust is emphasized, with calls to remove barriers such as forced arbitration clauses [ 01:20:06-01:20:09 ]

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. Many user agreements, particularly in big tech, act as "contracts of adhesion" that effectively bar private citizens from bringing antitrust lawsuits or class actions [ 01:22:08-01:22:26 ]

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. Ending these clauses could significantly increase private enforcement and allow for class action suits, which are often the most efficient way to address large-scale antitrust issues [ 01:25:47 ]

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. These private actions, especially with potential jury-awarded damages, are seen as a powerful deterrent that companies often seek to avoid .

Big Tech and Platform Regulation

Dominant technology companies, such as Apple, Amazon, and Google, are perceived as acting as "unaccountable regulators" within their industries, setting rules for app developers and controlling advertising markets . Monopoly abuse in these platforms creates high barriers to entry and limits consumer and competitor mobility . While tech companies initially resisted antitrust scrutiny, the DOJ and FTC have successfully pursued significant monopolization cases against them [ 02:02:45-02:03:12 ]

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. Concerns were raised about corporate connectivity, particularly with figures like Elon Musk, and the potential for malfeasance when powerful individuals have unfettered access to federal agencies and sensitive data .

Federal vs. State Roles and Licensing

Federal legislation is proposed to address state-level issues, such as repealing the Jones Act, a century-old federal restriction that has created a shipping monopoly, increasing costs for consumers and hindering disaster relief efforts [ 00:30:17-00:31:01 ]

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. Another key area is occupational licensing, where state laws often disadvantage out-of-state license holders, creating barriers for workers and businesses . Proposed solutions include federal incentives for interstate recognition, a federal recognition system, federal licensing for some professions, or a federal mandate to protect interstate commerce, especially given the limitations of the dormant commerce clause in addressing these issues .

Tone of the Meeting

The tone of the meeting was largely cooperative and bipartisan, with frequent expressions of gratitude and mutual respect among senators and witnesses [ 00:38:46-00:38:52 ]

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[ 01:19:09-01:19:20 ]

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[ 01:53:42 ]

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. There was a shared understanding of the problems stemming from market concentration and consumer harm . While underlying political differences on solutions (deregulation vs. enforcement) were present, speakers often found common ground on specific issues and legislative efforts, such as the OFF Act and addressing forced arbitration [ 00:28:52 ]

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. The discussions were robust and engaged, with a clear focus on actionable solutions to improve market competition .

Participants

Transcript

Are you sending the poor senator?  All right.
Call the hearing to order.  Today's hearing addresses   an important topic, a topic that I think is becoming increasingly important, unlocking innovation and new entry into the marketplace by reducing anti-competitive government regulations, regulations that in many instances secure the position of market incumbents to the exclusion of would-be competitors.  Far too often, federal regulations, even those that are there,   that are intended to protect the American public in one way or another, many circumstances they end up creating a whipsaw effect and having some really ugly consequences because they end up insulating businesses from competition.  One thing we understand about competition is that it tends to bring prices down and it tends to improve quality when competition is present.  But to the degree that competition is not present, the opposite tends to happen.   So when regulations require expensive compliance costs that only large incumbents have the meaningful ability to comply with while remaining competitive, regulations become monopoly moats rather than consumer protections.  The economic cost is enormous.   Now, just last year, just new federal regulations, major rules promulgated by executive branch agencies put into law without any subsequent additional vote by Congress or presentment to the President for signature of veto or acquiescence, added a record $1.5 trillion in new regulatory compliance costs, just the regs put in place in 2024 alone.  Now, that doesn't include the previous   regulations, which have been estimated, including last year's regulations, at somewhere in the three to four, some would say, more trillion dollars every single year.  This starts to rival what Americans pay in their federal taxes.  This is a huge draw on the economy, and it ends up disproportionately inuring to the detriment of America's poor and middle class.
This also doesn't include the innovations that never happened, the businesses that were never launched, and the competitive pressure that never materialized so as to bring quality up and prices down.  President Trump has recognized this issue and in April issued an executive order directing the federal government under his administration to identify regulations that hold back American businesses and stifle competition, thus ultimately harming consumers.   The response has been remarkable, and with organizations across the country, across every major economic sector submitting detailed comments about regulatory barriers that tend to increase compliance costs, that tend to limit innovation, and ultimately harm the consumers, the very consumers in many instances that they're supposed to help.   I want to thank, among others, members of our Federal Trade Commission, one of whom we'll hear from in a few minutes and who I'll introduce shortly, FTC Chair Andrew Ferguson and Attorney General, Assistant Attorney General Slater, for their leadership in prioritizing this issue and for sending witnesses from the Federal Trade Commission and from the Department of Justice's Antitrust Division to highlight their findings.  Deregulation   tends to level the playing field by removing barriers that stifle free market dynamics.  In such an environment, competition policy flourishes as firms are incentivized to innovate rather than being hindered.   I've introduced a number of bills over the years that deal with this issue one way or another.  I'd like to briefly describe three of those to give you sort of a cross-section of some of the approaches that we can take in this area.  First, the OFF Act, Opportunities for Fairness in Farming, a piece of legislation I'm very proud of and that's been co-sponsored by my ranking member, Senator Booker from New Jersey.
would reform the mandatory farmer assessment programs existing under federal law.  The Got Milk campaign or the Beef It's What for Dinner campaign, these are the kinds of things that are funded by these mandatory assessments to our farmers.  Unfortunately, some programs have awarded unauthorized bonuses.  For example, a USDA investigation found that   One organization had used checkoff funds for $300,000 in bonuses and then asked for more funds to fix their financial situation.  The checkoff programs are all too often used by the largest players in the checkoff program in the industry itself in order to entrench their position.   while severely undermining the interests of independent producers, many of which tend to operate with much narrower margins already.  And so the expense added by the check-off payments, which are mandatory, have the effect of a tax, end up disproportionately affecting them, and quite adversely.  This bipartisan legislation would require transparent financial reporting, it would ban conflicts of interest, and mandate regular audits in this area.   Second, the Open America's Waters Act would repeal the so-called Jones Act, more than a century-old federal restriction that's created something of a shipping monopoly or at least a distortion in the marketplace that ends up costing American consumers in some parts of the country more than others.   Our domestic cargo fleet has, during the little more than a century since that was enacted, shrunk to 92 ships, half of what we had in 2000.  In 2023, American shipyards built only five large vessels, while China built 1,749.  This artificial scarcity forces all of us to pay inflated shipping costs.
especially people in certain parts of the country.  Americans living in Alaska, in Hawaii, in Puerto Rico, Guam, and parts of New England suffer disproportionately for this.  So to the extent this is going to be a policy, we need to at least take into account that it's a policy with enormous costs that affects different Americans quite differently, and some very severely, depending on where they live.   The Jones Act's restrictions are so onerous that they even apply in many instances to transporting disaster relief supplies.  The result is watching relief cargo sit idle while Americans suffer after natural disasters.  The Open America Waters Act would unlock competition, reduce shipping costs, and allow consumers to receive goods faster.   Third, the Biosimilar Red Tape Elimination Act tackles artificial barriers in our healthcare system.  When developing biosimilar drugs, which tend to be very expensive in the world of pharmaceuticals, companies face unnecessary regulatory hurdles that keep cheaper alternatives to the original branded product off the market.   This bill would streamline the approval process by automatically deeming all approved biosimilars as interchangeable with their brand name counterparts.  This would eliminate a significant amount of redundant switching costs and switching studies that pharmaceutical companies use in order to delay competition and align regulation with current scientific reality.   In each case, and in the case of other reform legislation in this area, these bills removed needless government regulations.

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